* Says Sandy costs to be higher than Hurricane Irene
* Q3 shr loss 1 cent vs year-ago profit 14 cents
* Loses 10,000 video customers vs Street view 9,000 loss
* Says looking into unsolicited interest in its western
* Shares fall 5.3 percent
Nov 6 Cablevision Systems Corp reported
a third-quarter loss on Tuesday and its shares fell over 5
percent as investors worried about a decline in video customers
and the financial impact of Hurricane Sandy.
The cable provider said costs from Sandy, which knocked out
service for as many as half its customers, would be
substantially higher than its $16 million bill from hurricane
Irene in 2011.
Cablevision also said that it is exploring the possibility
for a sale of cable assets in four western U.S. states that it
bought for $1.4 billion in 2010, after it received unsolicited
inquires about the business.
Like bigger operators Comcast and Time Warner
Cable, Cablevision has been losing customers to rivals
such as satellite television provider DirecTV and
telephone operator Verizon Communications.
Cablevision lost 10,000 video customers in the quarter,
compared with analysts' expectations for a loss of 9,000, but it
added 28,000 Internet customers, ahead of the Wall Street target
of 23,000, according to StreetAccount.
Investors are worried about the impact of Sandy-related
costs on fourth-quarter results and whether storm-related
service outages will make it difficult for the company to raise
its prices, according to analysts.
"With a long and costly recovery from the storm ahead, and
with a longer term growth challenge that seems intractable, we
continue to struggle to see the bull case for Cablevision,"
Bernstein analyst Craig Moffett said in a research note.
At the end of the third quarter, the U.S. Northeast,
Cablevision's main operating region, was hit by Sandy, which
caused widespread flooding and power outages that disrupted
cable and telephone services.
Cablevision, which promised to rebate customers for their
time without cable service, is working to restore service to
customers affected by the storm which made landfall on Oct. 29.
It said its biggest challenge is power outages, which cut off
While most of the financial impact from Sandy will hit
fourth-quarter results, Cablevision executives said on a
conference call with analysts that the effect may extend into
2013 in the case of customer homes that will not be repaired
after the storm.
Hudson Square research analyst Todd Rethemeier, who looked
for the company to add video customers in the third quarter,
said Cablevision was being hurt by the weak economy as well as
"Until the economy recovers and the number of housing units
starts to grow again it will be tough to see significant
subscriber growth," Rethemeier said.
Also on Tuesday, DirecTV said it added 67,000 video
subscribers, and another satellite TV provider, Dish Network
Corp, reported 19,000 subscriber losses in the quarter.
Previously, Verizon had reported 136,000 FiOS Internet
customer additions and 119,000 FiOS video customers.
Cablevision posted a loss of $3.8 million, or 1 cent per
share, compared with a profit of $39.3 million, or 14 cents per
share, in the year-earlier quarter. Included in the latest
quarter was $61.1 million of debt refinancing costs.
Excluding unusual items, earnings per share were 23 cents,
compared with Wall Street expectations for 16 cents, according
to Thomson Reuters I/B/E/S.
Revenue rose to $1.69 billion from $1.67 billion, meeting
Wall Street expectations, according to Thomson Reuters I/B/E/S.
Cablevision executives did not give details on the call
about potential bidders for its western U.S. business,
previously known as Bresnan Broadband.
Cablevision, which first announced in May this year that it
was looking for strategic alternatives for its Clearview Cinemas
chain, said on Tuesday that it is still exploring its options.
Cablevision shares were 88 cents lower, down 5.3 percent, to
$15.65 in early afternoon trading on the New York Stock